Red is the child of a Canadian family financially ruined by the Great Depression. In desperate need of money, the family leaves Red with a horse trainer. Red eventually becomes a jockey, but makes extra money through illegal boxing matches which left him blind in one eye. Howard is a clerk in a bicycle shop who gets asked by a passing motorist to repair his automobile, a technology which has recently been introduced. As a result, Howard becomes knowledgeable enough with automobiles to increase their performance and sell them as a dealer, eventually becoming the largest car dealer in California and one of the Bay Area's richest men. However, his son is killed in an automobile accident while driving the family car, which sends Howard into a bout of deep depression, which eventually results in his wife (Valerie Mahaffey) leaving him.

On a trip to Mexico to obtain a divorce and to drown his sorrows, he meets Marcela Zabala (Elizabeth Banks). Marcela helps Howard overcome his depression, mainly through horse-riding. After marrying Marcela, Howard acquires a stable of horses and later has a chance encounter with the skilled and kindly horse trainer and drifter Smith. Howard hires Smith to manage his stables after Smith, who specializes in rehabilitating injured and abused horses, explains to Howard "You don't throw a whole life away just 'cause it's banged up a little bit". Smith convinces Howard to acquire the colt "Seabiscuit", who comes from noted lineage but had been deemed "incorrigible" by past handlers and was later broken and trained to lose against better horses.

Smith is unable to find a jockey willing to deal with Seabiscuit's temperament, but after witnessing Red Pollard brawling with other stable boys, he sees in him a similar temperament to the feisty horse and decides to appoint him as Seabiscuit's jockey. Seabiscuit and Pollard become close and they begin to race. After overcoming early difficulties, such as a dismissive media and Pollard's anger issues and blind eye, Seabiscuit begins to earn considerable success and becomes an extremely popular underdog for the millions affected by the Great Depression. Inspired, Howard tries repeatedly to provoke a race with the mocking New York tycoon Samuel Riddle and his fearsome stallion "War Admiral", the top race horse in the country. Riddle eventually relents to a match race on his terms between War Admiral and Seabiscuit, but while the date approaches, Pollard is injured in a riding accident, fracturing his leg. When the doctor reports that he will be unable to ride again, Red suggests that Howard get an old friend, the successful jockey George Woolf (Gary Stevens) to be Seabiscuit's new rider.

Red teaches Woolf about Seabiscuit's handling and mannerisms. At the match race, Seabiscuit upsets the heavy favorite, War Admiral, partly because of a secret that Pollard relates to Woolf, instructing him to hold him head to head with the other horse so he gets "a good look at the Admiral." Later on, Seabiscuit is racing at Santa Anita when he is injured and has to stop. Red helps him to recover and get fit enough to race again. The last race is again at the Santa Anita, and Red rides him this time after putting a special self-made brace on his own leg to keep it stable. Woolf is on a different horse. Seabiscuit drops to last place and trails the pack, but Woolf holds back to be alongside Red and let Seabiscuit "get a good look". After a short conversation, Seabiscuit surges and wins the race.

Red says, "You know, everyone thinks that we found this broken down horse and fixed him, but we didn't. He fixed us. Every one of us. And I guess in a way, we kinda fixed each other, too."

The film received positive reviews from critics. On the review website Rotten Tomatoes, 77% of critics gave the film positive reviews, based on 199 reviews, and an average rating of 7.1/10, with the consensus: "A life-affirming, if saccharine, epic treatment of a spirit-lifting figure in sports history".[2]